I love doing this newsletter in part because of the people who read it… Here is subscriber Larry none too impressed with Charlie Munger's comments; comments that NFTRH did not take personally. It just churned ole' Charlie into the analysis. But Larry is pretty fed up with the buffoonery that is allowed to express itself in the mainstream financial media.
Dear Mr. Munger:
Recently, you rather arrogantly claimed that civilized people don’t buy gold. I am not sure how you define civilized, but the comment struck me as odd since I thought you were a profit maximizing capitalist. You further said that gold does not compare in investment quality to operating businesses. Is this statement just an example of you talking your own book? Or, are you intentionally trying to mislead people? The reason I ask is that I bought gold in 2003 at $320 per ounce. Today it trades at $1,640 per ounce, or 5.1 times my cost basis. This investment has given me a compound annual return of 19.91% over a 9 year time frame. Frankly, I think you would be hard pressed to find another investment which has done so well in this timeframe. Of course, I could have done what you suggested and bought operating businesses. Let’s look at how I would have done if I had purchased the DOW, the S&P500 or your stock, Berkshire Hathaway.
2. Better to remain silent and be thought stupid, than to open your mouth and remove all doubt.
Without bailouts of some of your largest portfolio companies Berkshire Hathaway’s stock would be worth much less. Or, perhaps, even worthless. Frankly, those of us who have labored honestly in this capitalist system are fed up and disgusted with “crony capitalists” like you and your partner. Sure the system works for you. Let’s see how you do in a sound money system. Perhaps that is why you are so hostile to the concept?